Central Arkansas Water Extends Lease Agreement
Central Arkansas Water officials have decided to extend a lease agreement for space in the Simmons Bank Tower at 425 W. Capitol Ave. in Little Rock. This extension is necessary while the water utility’s headquarters is being renovated. The utility’s board of commissioners voted to authorize the extension, which was initially set to expire on September 30, 2026, but will now expire on May 31, 2027.
Lease Details
The lease extension will cost Central Arkansas Water $19 per square foot per month, totaling $60,572 monthly. Over the eight-month period, the utility will pay a total of $484,576. This expense will be funded using excess revenue from 2023. The decision to extend the lease was approved as part of the board’s consent agenda, along with two other items.
Renovation Plans
The headquarters, located at 221 E. Capitol Ave., is undergoing renovations due to mechanical issues with its elevators and heating, ventilation, and air conditioning system. The four-story building, originally constructed in 1973, will be substantially complete by February 2027. Utility officials had considered relocating the headquarters to a different location but ultimately decided to renovate the existing building.
Previous Considerations
In the past, officials examined various potential sites, including an office building in the Riverdale neighborhood of Little Rock. However, they decided that moving to another downtown building would be more expensive than renovating the current headquarters. Relocating outside of downtown Little Rock would also mean removing a dynamic workforce from the downtown area.
Construction and Funding
The board approved a guaranteed maximum price of nearly $19 million for the headquarters construction work, led by East Harding Construction. This figure includes close to $1.8 million in owner’s contingencies and allowances that will be recouped by the utility if the money is not spent. Additionally, furniture and fixtures are expected to cost another $1.7 or $1.8 million. Central Arkansas Water has applied for a $1.5 million grant from the Arkansas Economic Development Commission to support the cost of the project.
Conclusion
The extension of the lease agreement will provide Central Arkansas Water with the necessary space while its headquarters is being renovated. The renovation project aims to address the mechanical issues and improve the overall condition of the building. With a planned completion date of February 2027, the utility is working to ensure that the project is finished as scheduled and within budget. The decision to renovate the existing building rather than relocate demonstrates the utility’s commitment to supporting the downtown area and its redevelopment efforts.
